Time in which we live, – an epoch of changes. Our society carries out extremely difficult, in many respects inconsistent, but historically inevitable and irreversible reorganization. In a sociopolitical life it is transition from totalitarianism to democracy, in economy – from command system to the market, in a life of the separate person – its transformation from „clincher“ in the independent subject of economic activities. Such changes in a society, in economy, in all our vital way are complex that they demand change ourselves.
The important part of this change as shows world experience, – comprehension of a science and art of management.
In the simplified understanding, management is a skill to achieve objects in view, using work, intelligence, motives of behavior of other people. Management – in Russian „management“ – function, a kind of activity on a management people in the diversified organizations. Management is also area of the human knowledge, assisting to carry out this function. At last, management as collective from managers is the certain category of people, a social layer of those who works on management.
And management is considered as process because work on achievement of the purposes with the help of others is not any lump sum action, and a series of the continuous interconnected actions. These actions, each of which in itself is process, are very important for success of the organization. They name administrative functions. Each administrative function too represents process because also will consist of a series of the interconnected actions. Managerial process is a total sum of all functions.
Managerial process (management) has four interconnected functions: planning, the organization, motivation and the control.
• the organization
• the control
Function of planning assumes the decision on what should be the purposes of the organization and that members of the organization should do to reach these purposes.
Strategic planning represents a set of actions and the decisions undertaken by a management which conduct to development of the specific strategy, intended to help the organization to reach the purposes.
Process of strategic planning is the tool assisting in acceptance of administrative decisions. Its problem – to provide innovations and changes in the organization sufficiently. More precisely speaking, process of strategic planning is that umbrella under which all administrative functions are covered.
Essence of strategy.
The word „strategy“ has taken place from Greek “strategos”, (art of the general). Strategy represents the detailed all-round comprehensive plan, intended to provide realization of mission of the organization and achievement of its purposes.
The strategic plan should be developed more likely from the point of view of prospect of all corporations, instead of the concrete individual. Though, at the personal enterprises the founder of the enterprise presumes relative luxury to combine to itself personal plans with strategy of the organization.
The strategic plan should be proved by extensive researches and the fact sheet. Effectively to compete in the today’s world of business, the firm should be engaged constantly in gathering and the analysis of huge quantity of the information on branch, the market, a competition and other factors.
The strategic plan gives to firm definiteness, individuality that allows it to involve the certain types of workers, and, at the same time, to not involve workers of other types. This plan opens prospect for the organization which directs its employees, involves new workers and helps to sell products or services.
At last, strategic plans should be developed so that not only to remain complete during the long periods of time, but also to be flexible enough that if necessary it was possible to carry out their updating and reorientation.
Planning and success of the organization.
Some organizations, as well as individuals, can excel the certain level, not spending the big work on formal planning. Moreover, strategic planning in itself does not guarantee success. The organization creating strategic plans, can fail because of mistakes in the organization, motivation and the control.
Process of strategic planning.
Nevertheless, formal planning can create number important and frequently essential favorable factors for the organization.
Modern rate of change and increase in knowledge is so big, that strategic planning is represented by unique way of formal forecasting of the future problems and opportunities. Strategic planning gives a basis for decision-making. Formal planning promotes decrease in risk at decision-making. Planning as it serves for a formulation of the established purposes, helps to create unity of an overall aim inside of the organization.
For strategic planning the following positions are characteristic.
1. The small planning section (less than 6 people) corporations are supplemented with planning at the lowest levels.
2. The age of function of planning even in the largest corporations is totaled less than ten years.
3. Strategic plans are developed at meetings of the top management of the corporation, spent annually.
4. The annual strategic plan is united with the annual financial plan.
5. In the
majority of the organizations consider, that function of planning
Can be advanced.
The purposes of the organization. The first and, maybe, the most essential decision at planning will be a choice of the purposes of the organization.
The basic overall aim of the organization – the well defined reason of its existence – is designated as its mission. The purposes are developed for realization of this mission.
Mission details the status of firm and provides a direction and reference points for definition of the purposes and strategy at various organizational levels. Formulation missions of the organization should contain the following:
1. A problem of firm from the point of view of its basic services or products, its basic markets and the basic technologies. Easier speaking, in what enterprise activity the firm is engaged?
2. An environment in relation to firm which defines working principles of firm.
3. Culture of the organization. What type the working climate exists inside of firm? What type of people involves this climate?
To choose corresponding mission, the management should answer two questions: (who our clients?) And (we can satisfy what needs of our clients?) The client in the given context will be anyone who uses results of activity of the organization. Clients of non commercial organizations will be those who use its services and provides with its resources.
Overall aims of firm are formulated and established on the basis of the general mission of the organization and the certain values and the purposes by which the top management is guided. To bring in the true contribution to success of the organization, the purposes should possess a number of characteristics.
1. First, the purposes should be concrete and measurable. Expressing the purposes in concrete measurable forms, the management creates precise base of readout for the subsequent decisions and estimations of a course of work.
2. The concrete horizon of forecasting represents other characteristic of the effective purposes. The purposes are usually established on long or brief time intervals. The long-term objective has horizon of planning approximately equal to five years. The short-term objective in most cases represents one of plans of the organization which should be finished within the limits of a year. The intermediate term purposes have horizon of planning from one till five years.
3. The purpose should be achievable, – to serve increase of efficiency of the organization.
4. To be effective, the plural purposes of the organization should be mutually supporting – i.e. actions and the decisions necessary for achievement of one purpose, should not prevent achievement of other purposes.
The purposes will be a significant part of process of strategic management only in the event that the top management correctly will formulate them, and then is effective informs on them and stimulates their realization in all organization. Process of strategic management will be successful in that degree in what the top management participates in a formulation of the purposes and in what measure these purposes reflect values of a management and a reality of firm.
Realization of the strategic plan.
Strategic planning gets sense when it is realized.
After a choice of basic general strategy she is necessary for realizing, having united with other organizational functions.
The important mechanism of coordination of strategy is development of plans and reference points: tactics, policies, procedures and rules.
Tactics represents concrete short-term strategy. The policy represents the general reference points for actions and decision-making. Procedures order actions which should be undertaken in a concrete situation. Rules specify that it is necessary to do in a concrete situation.
Estimation of the strategic plan.
Development and the subsequent realization of the strategic plan seems simple process. Unfortunately, too many organizations apply a method “to introduce immediately” in relation to planning and catastrophic fail. The continuous estimation of the strategic plan has extreme value for long-term success of the plan.
The estimation of strategy is carried out by comparison of results of work with the purposes. Process of estimation is used as a feedback mechanism for updating strategy. To be effective, the estimation should be carried out is system and is continuous. Properly developed process should cover all levels – from top to down. At an estimation of process of strategic planning it is necessary to answer five questions:
1. Whether strategy of organization internally compatible with opportunities is?
2. Whether evaluate strategy an allowable degree of risk?
3. Whether the organization by sufficient resources for realization of strategy possesses?
4. Whether strategy takes into account external dangers and opportunities?
5. Whether this strategy by the best way of application of resources of firm is?
To organize – means to create a certain structure. The organization is a process of creation of structure of the enterprise which enables people to work effectively together for achievement of its purposes.
The organization of interaction and power.